Normand Desmarais of TiER1 Performance Solutions, Brent Cooper of C-Forward IT and Eric Vail of 3z.net. / The Enquirer/Patrick Reddy

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COVINGTON — It’s entirely appropriate that the successful effort to relocate UpTech to its future home in Covington took a mix of developers, non-traditional funders, corporate sponsors and elected officials from around the region and across the river.

After all, establishing a more collaborative environment was among UpTech’s top goals as it prepared for its second class of startups, which is scheduled to start working in September.

The city of Covington’s commissioners last month unanimously approved a five-year lease to bring UpTech to 112 Pike St. But the story is bigger than just new co-working space for a 2-year-old accelerator and the information technology companies that it’s helping to build.

It’s also about collaboration across the Ohio River, efficient public-private partnerships and the latest example of how civic leaders are linking the urban core with economic development. It’s also about creating a tech corridor in Northern Kentucky, and adding influence to a growing core of startups and entrepreneurial efforts already here.

UpTech is just one part of a larger, $1.5 million plan to renovate the 112 Pike St. building into space where bright, young entrepreneurs want to work and live. UpTech, developed out of the Northern Kentucky ezone and Vision 2015, will take the first floor. Higher floors will be transformed into residential apartments.

Program manager Amanda Greenwell wants UpTech to be a community magnet where bright minds in the neighborhood drop in for a cup of coffee, have a meeting or brainstorm in an inspiring space.

It all has its roots in what UpTech founder Casey Barach calls The Big Idea: To build an informatics industry cluster in Northern Kentucky.

Two years later, the vision has become a reality.

“The Northern Kentucky community embraced the idea and has supported it beyond my wildest expectations,” Barach said. “Covington and its support of having UpTech’s home is just further evidence that NKY believes that early stage informatics companies are an integral part of the future economy of Northern Kentucky.”

Building developed and ready for 'a great organization'

The project began with Covington-based developers Tony Kreutzjans and Marc Tischbein buying the Pike Street building in 2007for $195,000. They have also invested about $155,000 to restore the building’s exterior and surrounding areas.

Kreutzjans and Tischbein wanted to turn the building into a mix of commercial and residential space that has become popular in other urban cores, particularly Over-the-Rhine. But traditional lenders are wary of financing these projects unless the developers have a signed tenant, a challenge exacerbated by the recession.

Then, starting late last year, a confluence of events began that jump-started the project, brought the key players together, and landed UpTech in its future Covington headquarters.

UpTech launched in 2012 at One Riverfront Place in Newport, a traditional office building that was critical to the accelerator’s development, but never viewed as a long-term headquarters. Greenwell wanted space in the urban core that would facilitate a collaborative working environment.

She connected with Naashom Marx, Covington’s business development manager, and previously director of the Kentucky Innovation Network.

Marx knew about the Pike Street building and thought UpTech would be a good fit.

“We saw it as a good opportunity to get another building developed and ready, but also to bring in a great organization that really was going to bring in good synergy for the other things that are going in the city,” Marx said.

Covington making Pike Street a center of revitalization

Before UpTech even entered the picture, the Center for Great Neighborhoods of Covington had made redeveloping Pike Street a critical part of ongoing efforts to revitalize and connect the city’s urban core with its more vibrant business and residential district along the Ohio River. The center was already bringing in non-traditional financing sources to help Kreutzjans and Tischbein develop the property.

Those sources included The Catalytic Fund, which has raised $10 million to help jump-start development in Northern Kentucky’s urban core. It was interested in the Pike Street property and liked the mixed-use approach.

Jeanne Schroer, the Catalytic Fund’s executive director, then connected with Kathy Schwab, executive director of the local chapter of LISC, which is based in Cincinnati. Investing in urban neighborhoods is part of LISC’s core mission.

The two organizations teamed up to provide Kreutzjans and Tischbein with the necessary financing to renovate the inside of the building. LISC loaned $703,000; the Catalytic Fund loaned $175,000. The Duke Energy Foundation also stepped up with a $35,000 urban revitalization grant.

“So much about Covington’s revitalization is creating safe, walkable, desirable neighborhoods in which to live. And that’s our mission. You can only do that in communities by collaboration,” Schwab said. “You can’t do it alone, and the city can’t do it alone.”

By June, UpTech had emerged as a potential tenant, which reinforced the project’s potential. The accelerator will bring in eight to 10 high-potential information technology startups to the region every year.

The pieces were in place for Covington commissioners to vote in favor of making their own investment into the property.

Combined resources bring 'good energy'

The city, which is providing a $70,000 community development block grant to help with the upper floor rehabilitation, is also helping UpTech pay its five-year lease. Covington will contribute $47,000 the first year, and then $37,000 for each of the next four years. UpTech’s portion increases from $10,000 in year one, to $20,000 in each of the following years.

“It took all of the different funding sources to make this happen,” Kreutzjans said. “It wouldn’t have happened otherwise.”

UpTech’s move further establishes Covington as hub of startup activity. Around the corner on Russell Street is bioLOGIC, the SIDIS-owned incubator and accelerator for biotech companies.

“I think it’s going to add good energy and get more people into Covington, which is great,” said Keith Schneider, bioLOGIC’s managing director.

Covington is also home to several established technology companies, including TiER1 Performance Solutions and C-Forward Information Technologies.

TiER1 chairman Normand Desmarais is an UpTech board member, and C-Forward president Brent Cooper is an investor in UpTech’s fund, which provides capital to the accelerator’s portfolio companies.

Cooper said UpTech’s move is a win for the city and the accelerator’s future portfolio companies, which will be able to more easily closely collaborate not only with each other, but established entrepreneurs in the area.

“It’s a symbol of the momentum that’s been building over the last couple of years in Covington,” Cooper said. “The potential and the promise of close collaboration with other innovators are so critical to a startup’s success. It’s a great move for Covington, it’s a great move for UpTech. It’s a perfect fit.” ⬛

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